A CEO's guide to VoIP/Unified Communication

Productivity justifications are taking over from costs savings as the main drivers for VoIP and IP Telephony implementations, finds Simon Hendery...

There was a time when VoIP (Voice over Internet Protocol) phone systems were simply a cheap telephony option for businesses wanting to slash their toll bills. That approach was so last century, say vendors.

IP telephony is now mainstream – business IP handset sales now outnumber sales of traditional handsets – and the corporate IP network is increasingly seen as the backbone of a company-wide, productivity-boosting unified communications solution.

While toll bypass may still be a factor, lower overall toll charges from networks means today’s business case around IP telephony is quite different, with cost savings from IP telephony deployment now around things like moving to a single network from running a disparate set of data and voice networks.

The ability to run voice and data over a single platform and the associated admin costs that are reduced as a result can be a major cost saving for many widely dispersed organisations.

Similarly, enterprises running several call centres in different locations are attracted to IP’s ability to create a much more cohesive single ‘virtual’ call centre.

Using an IP-based system, inbound calls can be routed to the expert best capable of handling them, no matter where that staff member may be.

This type of skills-based routing is one of the many productivity boosting solutions available through an IP-based unified communications deployment.

Image courtesy Telecom IP Voice

Are you there?
Presence, the ability to check a co-workers location and availability before you call them, is a major selling point for unified communications, as anyone who spends much of their day playing telephone tag will appreciate.

Presence displays information including (but not limited to) if a person is in a meeting, interruptible or on the phone. Or a worker could have their presence information say they’re in a meeting but are able to receive text messages.

For corporates running multiple work sites, or with large numbers of mobile workers,the collective loss of productivity as a result of staff trying to track each other down over the phone can be significant.

Rising travel costs are also driving users to IP solutions. In an IP context video conferencing has become a lot more flexible and convenient compared to the past when users had to go to a special room that had been professionally wired up.

Image courtesy Telecom IP Voice

While video calling hasn’t yet reached its full potential in the local market, it’s expected to become increasingly popular as fuel prices bite and corporates embrace the cost saving benefits of video conferencing and video collaboration over desktop PCs or laptops (see the Microsoft unified communications case study for more on this topic).

In general, it’s a desire for simplification that’s driving unified communications uptake.

The ‘single mailbox’ concept behind unified messaging – allowing staff to pick up all their voice and data messages through one access point – has growing appeal for corporates, especially as staff spend more time communicating out of the office and VoIP offers them PBX functionality on a mobile phone (and the ability, for example, to transfer calls from their mobile to desk extensions).

Image courtesy Telecom IP Voice

If staff do have to travel, a ‘soft phone’ application on a PC or laptop offers another powerful productivity tool and potential cost saver. A salesperson connecting from an overseas hotel room via a virtual private network, for example, can access their company’s full PBX services through their laptop, enabling them to cut down on expensive global roaming charges.

Another of unified communication’s strengths is its ability to integrate with key desktop applications such as Lotus Notes or Microsoft Office. Integration with other applications such as CRM or ERP systems can also offer big productivity gains. Call centre staff, for example, only need to make a single mouse click to dial a number using their CRM database.

So the functionality is great, but can the cost of moving to IP and unified communications be justified? Considering the well-touted advantages, what prevents some businesses from investing? Vendors says businesses may need to realise a return on investment from a legacy telephony system or want to wait until data and telephony network upgrade timing aligns.

While the arrival of ‘end of life’ of a data network or telephony system may be the ideal time to invest in VoIP, there are other options. Interestingly, most companies taking the plunge do not opt for a full ‘rip and replace’ IP deployment, preferring the more cost-effective option of upgrading parts of their traditional telecommunications network as required.

This is commonly referred to as a hybrid deployment, meaning a business takes the best of what they’ve got, upgrading it where possible to get IP functionality but continuing to use as much of their existing infrastructure as possible. This is a common approach that most vendors and implementers in the VoIP space are familiar with.

While the benefits of unified communications are many, there is some effort required and corporates need to be aware that an IP deployment will involve a degree of staff training to achieve its full benefits.

Image courtesy Telecom IP Voice

Readers familiar with Skype telephony can rest easy though, as the quality of service issues that impacted early VoIP users are a thing of the past now as improvements both in the technology and bandwidth availability means call quality to the level required for business-critical activity is now readily available.

How long for a Return On Investment?
When it comes to VoIP planning, vendors say to start with a business case for VoIP, and then research what type of installation your business requires (full, hybrid, hosted etc).

Image courtesy Telecom IP Voice

While the ROI will differ from company to company, a 2005 Intel study showed telecommunications-related capital purchase costs were estimated to be halved with VoIP, and the increase in employee productivity with an open-standards VoIP system was up to $US500 per employee per year.

The survey also calculated a 52 percent reduction in the cost of moves, add-ons and changes between legacy PABX systems and new open-standards VoIP network installations. VoIP research at IBM reported a 30-minute per day increase in productivity per person and some vendors say that by combining business processes, applications and an intelligent [VoIP] information network, organisations can achieve three to five times these productivity improvements.

In terms of a local example, The Sydney Morning Herald recently reported the interesting case of Adelaide Beach Petroleum, a company with a drilling rig 800 kilometres from Adelaide and 150 kilometres from the nearest town, that was relying on satellite communications to stay in touch.

Satellite voice and data services were costing up to $300 a day until the company cut its bill by two-thirds by adopting a satellite VoIP system.

Voice calls now travel as data to Adelaide via satellite where they link with the local telephone service and are charged at local call rates. Internet access is available at up to 512 Kbps. Adelaide Beach Petroleum systems supervisor Simon McMahon was quoted saying the system paid for itself in about six months.

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